CENTRAL BANK OF KENYA
Remarks by
PROF. NJUGUNA NDUNG’U
GOVERNOR
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Crowne Plaza Hotel,Upperhill, Nairobi
Wednesday, July 14, 2010

Hon. Uhuru Kenyatta, Deputy Prime Minister and Minister for
Finance of the Republic of Kenya;
Fellow Central Bank Governors of the Eastern Africa Sub-region;
The Executive Secretary General of the AACB;
Chief Executives of Regulatory Authorities in Kenya;
Distinguished Guests;
Ladies and Gentlemen:
Hon. Deputy Prime Minister and Minister for Finance, allow me to
thank you most sincerely for finding time from your busy schedule to grace this
important meeting in the calendar of Central Banks in the Eastern Africa
Region. Your presence here today demonstrates the serious commitment of the
Government of Kenya to monetary and financial integration in the Continent
as we strive to become a regional financial hub in line with Kenya’s Vision
2030. For instance, just this month, we witnessed the launching of the
implementation of the East African Common Market.
May I also extend a hand of welcome to my fellow Governors from the Eastern
Africa sub-region present here today. I heartily thank you for finding time to be
in Nairobi. This is indeed a very great honour to the Central Bank of Kenya
and our country. I also warmly welcome the Executive Secretary of the AACB
whose presence and contributions in the deliberations we look forward to.
We also appreciate the presence of the Chief Executives of other Financial
Sector Regulatory Authorities in Kenya, whose presence here today signifies
the all important synergy required between the different regulators in the
process of financial integration.
Hon. Minister, the Abuja Treaty envisaged the integration of the African
Continent through, among others, the strengthening of the sub-regional
groupings and harmonization of national policies for the eventual evolvement
of a monetary union in the continent.

In line with this, the Assembly of Governors in the Continent have been
implementing the African Monetary Cooperation Programme (AMCP) since
they adopted it on September 4, 2002 in Algiers. The objective of this program
is to put in place a common single currency and a common single central bank
at continental level by 2021, at the end of a successful convergence process, in
accordance with the African leaders’ vision of consolidating economic
integration in Africa.
Commendable progress in the implementation of the AMCP by the Eastern
Africa sub-region has been made. Most of our active members have been
meeting a number of the macroeconomic convergence targets, as we continue
harmonization and co-ordination of macroeconomic and monetary policies.
We recently embarked on Stage III (year 2009-2012) of the programme, whose
successful implementation and assessment of macroeconomic performance will
form a basis for the establishment of a Continent wide common Central Bank.
In addition Hon. Minister, the assembly of Governors are working on a
common strategy with regard to the establishment of the African Central Bank
(ACB) as well as advising on the formation of both the African Investment
Bank (AIB) and the African Monetary Fund (AMF). The realization of these
institutions will bring us closer to a Continent wide monetary union.
Hon. Minister and Fellow Governors, benefits of integration have been
evident across the globe, including securing access to larger markets, enhancing
trade flows and in the process attracting the much needed foreign direct
investments, lowering trade costs among neighbours, leveraging or locking in
domestic reforms, increasing bargaining power and political cohesion among
others. Notwithstanding these benefits, regional groupings in Africa have
tended to give less emphasis to monetary integration. Under the AMCP, the
Eastern Africa sub-region Central Banks evaluate each other annually to ensure
convergence in policies as we pursue further monetary integration.

This meeting, Hon. Minister, will therefore consider the progress on the
implementation of the African Monetary Co-operation Programme (AMCP) by
the Eastern Africa sub-region countries in 2009; consider macroeconomic
performance against the AMCP targets and the status of execution of the
decisions of the 8th meeting of Governors of the sub-region held in Moroni,
Comoros.
My fellow Central Bank Governors, Ladies and Gentlemen, with these
few remarks it is now my humble duty to invite the Hon. Deputy Prime
Minister and Minister for Finance to address and officially open this meeting.
Welcome Hon. Minister